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HSB 544

A bill for an act creating an endowment tax on the endowment value of certain Iowa colleges and universities, limited charges relating to certain endowment funds, making appropriations to workforce grant and incentive programs, and making appropriations to supplement tuition grants for high-wage and high-demand jobs.

2025-2026 Regular Session

Imposes an endowment tax on qualifying Iowa colleges and uses the revenue to fund workforce grants, incentives, and tuition aid for high‑wage, high‑demand programs.

Committee report approving bill, renumbered as HF 2240.
#collegesanduniversities #endowmentfunds #grants #taxation #tuitiongrants
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Bill Summary · HSB 544

Summary of Bill: HSB 544 (Session 2025-2026, Iowa)

Purpose and Intent

  • HSB 544 proposes a multifaceted set of provisions intended to support higher education funding and workforce development in Iowa. The core ideas include:
    • Establishing an endowment tax on the endowment value of certain Iowa colleges and universities.
    • Implementing limited charges related to certain endowment funds.
    • Making appropriations to programs that support workforce grants and incentives.
    • Providing appropriations to supplement tuition grants for high-wage and high-demand jobs.

Key Provisions

Endowment Tax and Related Charges

  • Imposes or establishes an endowment tax based on the endowment value held by qualifying Iowa colleges and universities.
  • Includes provisions for limited charges tied to specific endowment funds. Details on the calculation method, rate, applicability, and exemptions are not provided in the summary, but the intent is to generate revenue linked to institutional endowments.

Workforce Grant and Incentive Programs

  • Authorizes appropriations to fund workforce-related programs, emphasizing grants and incentives aimed at expanding workforce development.
  • Potential recipients include nonprofit, educational, or public-private initiatives that support job training, apprenticeships, and skill development aligned with Iowa’s labor market needs.

Tuition Grants for High-Wage, High-Demand Jobs

  • Directs appropriations to supplement tuition grants specifically for programs leading to high-wage and high-demand occupations.
  • Aims to increase access to education in fields with strong labor market demand, potentially reducing student debt and expanding the pipeline for in-demand roles.

Who Would Be Affected

Affected Entities

  • Iowa colleges and universities that qualify for the endowment tax and related charges.
  • Endowment funds associated with qualifying institutions (potentially affecting investment strategies and fund management).
  • Postsecondary students pursuing programs in high-wage, high-demand fields who rely on tuition grants.
  • Workforce development organizations and institutions administering grants and incentive programs.

Broader Impacts

  • States’ higher education funding landscape could shift, with a new revenue source from endowment taxation influencing state allocations to workforce initiatives and tuition support.
  • Institutions may adjust budgeting, endowment management, or fundraising strategies in response to new tax/charges and potential revenue expectations.

Procedural and Timeline Aspects

  • Introduction and Referral:
    • Introduced and referred to the House Higher Education Committee on January 13, 2026.
  • Subcommittee Process:
    • Subcommittee met and recommended passage (January 22, 2026).
    • Subcommittee members: Collins, Brown-Powers, and Hora.
    • Subcommittee meeting scheduled for January 22, 2026 (as per notice).
  • Committee Action:
    • Subcommittee reported favorably.
    • Committee reported favorably with amendment and passage (January 28, 2026).
    • Committee vote: 6 yeas, 4 nays, 1 excused (January 28, 2026).
  • Renumbering:
    • The bill was renumbered as HF 2240 in the committee report on January 30, 2026.

Notes and Considerations

  • The summary reflects the bill’s stated components and the procedural path through the Iowa General Assembly as of the latest action.
  • Specific details such as the exact tax rate, applicability criteria for the endowment tax, exemptions, calculation methodology, and the precise allocation formulas for grants and tuition supplements are not included in the provided information. These would be specified in the full bill text and any amendments.
  • The policy mix indicates a balancing act between revenue generation from institutional endowments and targeted public investments in workforce development and student aid.

If you’d like, I can incorporate the exact bill language or forthcoming amendments to provide a more precise, line-item summary of provisions, thresholds, and fiscal estimates.

Compiled from official sources — confirm details with the bill’s official record.

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